The price of your product | service is basically the amount that a customer pays for it. Price is a very important component of the marketing mix definition.
It is also a very important component of a marketing plan as it determines your profit and loss
Having the right price tag can be of a great impact on the overall marketing strategy as well as affecting your sales and customer demand of your product | service
If you are a startup and you have not made a name for yourself yet, it is unlikely that your target market will be willing to pay a high price.
Pricing always help shape the perception of your product | service in customer’s eyes
When setting your price tag, you should consider the perceived value that your product offers | service offers
Below are important pricing strategies
- Market penetration pricing
- Market skimming pricing
Ask yourself these questions when setting your product |service price
- How much did it cost you to produce the product | service?
- What is the customers’ perceived product | service value?
- Do you think that the slight price decrease could significantly increase your market share?
- Can the current price of the product | service keep up with the price of the product’s | service’s competitors?
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Stay tuned for our next post as we share the 4th P for marketing success – Promotion